The figure is a traditional expression of average productivity and marginal productivity.
2.
The reason behind this is the diminishing marginal productivity of labor.
3.
The maximum for production performance is achieved at the volume where marginal productivity is zero.
4.
However, marginal productivity ethics were defended by George Stigler.
5.
Adam Smith, in his theory, has not assumed his production function to have Diminishing marginal productivity.
6.
The marginal productivity of an engineer is 16 times that of unskilled production workers, yet the wage differential is only five-fold.
7.
Similarly, owners of machines and real estate are compensated according to the marginal productivity of their capital's contribution to marginal output.
8.
Under these models, wages are not determined strictly by the supply and demand for labor but by the marginal productivity of workers.
9.
Poor countries have more labor relative to capital, so marginal productivity of labor is greater in rich countries than in poor countries.
10.
Furthermore, he emphasises the marginal productivity of computing technology affects standard of living in a much more contained fashion than the earlier great American inventions.
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